ABE MEMBERSHIP NUMBER 486433

STAYING AHEAD OF THE

GAME

Assignment submitted in requirements of the

POST GRADUATE DIPLOMA IN BUSINESS MANAGEMENT

Association of Business Executives - UK

By : Sinthiya Krishnadas
To : London Business School – Sri Lanka

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TABLE OF CONTENTS PAGE

Acknowledgement 3

Abstract 4

Executive summary 5-6

Introduction and theatrical framework 7

Challenges for the printing industry in Sri Lanka 8-9

Now and the Potential Future of JDC Group 11

A strategy for the future 11

Future Directions of JDC Group 12

Conclusion 13

Appendices and literature cited

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ACKNOWLEDGEMENT

First & foremost I express my deepest gratitude & sincere thanks to my lecturer for his
valuable guidance, blessings, his constant encouragement and support throughout the
course, especially for the useful suggestions given during the course period.

Also I am very grateful to my colleagues for providing me with an environment to

complete my assignment successfully.

Finally I take this opportunity to extend my deep appreciation to my management for

all that they meant to me during the times of the completion of my assignment work.

Sinthiya Krishnadas

15/11 2010

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ABSTRACT

Creating a strategy is an important function that significantly determines an organization’s

performance in delivering customer requirements. This assignment investigates the printing
company who invest in new technology, offer new and added value services , and provide
excellent customer service, who are managing to stay above the fray and focus on the future.

Technology across every industry is in a constant state of development and enhancement, and
print media is no different. Whether it’s new formats, inks, bridging technologies linking print
with online, or video-in-print, these all add enormous value to the marketing power of print
media.

In order to thrive in the new world of print, companies must increase efficiencies to emerge
from the storm positioned for success. Printing industry pundits and economists believe that
conditions in the Sri Lanka print market will also improve by year’s end, and when recovery
comes it will be survival of the fittest.

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EXECUTIVE SUMMARY
In fiscal 2009, ended march 31, 2009 the JDC group regrettably experienced a downturn in both
revenues and earnings. This was attributed to a global economy that was buffeted by
unprecedented harsh operating conditions. Like most other industries, the printing sector
suffered a decline of global proportions.

Responding to the deteriorating operating environment and the slump in its operating
performance, the JDC Senior Management formulated the “Leaning Against Wind” in
November 2009. This strategic plan designed to address critical issues covering the period from
January 2010 to March 2011, encompassing efforts to adjust production aimed at reducing
inventories, to cut back fixed and manufacturing cost as well as capital expenditure.

Looking ahead, the management seeks the continued support and understanding of all
stakeholders as it strives to secure a turnaround in its operating performance and to strengthen
its business base.

Company’s most pressing issues:

“Delivering products and services that accurately address market and customer needs while at
the same time promoting business globalization’’ – J D Cyril - Managing Director of JDC
Group of Companies.

In the context of its rapid worldwide surge, electronic media is the focus of much attention due
to both the competitive and complementary aspects of its relationship with print media.
Taking these changes in its business environment into consideration, the JDC Group will focus
on the following core initiatives;
1. Ensuring that its products and customer needs, the group is strengthening its efforts.
2. Cultivating customer recognition of the comprehensive quality gains, in addition to
traditional design values and production quality management.
3. Promoting business activities that boost cost – competitiveness.
4. Working to re-establish a product development system that accurately incorporates the
needs of customers and the changing times, JDC is taking into consideration

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 performance, the environment, safety, systems efficiency, utilization rates and related
factors.
Recognizing crisis conditions was an opportunity to reform the JDC structure and system, the
management worked closely to implement the “Leaning Against Wind” strategic plan in an
effort to further enhance their competitive advantage and cement the position as a leading
company.

Group Chairperson Mr.J D Cyril is of the view that compared to the prevailing economic
situation locally and internationally and the high competitive nature of the industry the group
has displayed its strong footprint in the market place achieving comparatively better results
during the year 2008 – 2009. The ongoing transformation program of JDC will further enhance
its strengths.

INTRODUCTION AND THEARICAL FRAMEWORK

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worldwide manufacturing industries are in constant search for means of producing faster,
cheaper, and better products or services (Uribe, 2008). In line with this, production takes a
dominating and strategic logistic function in the process of order fulfillment (Helbing & Reichel,
1998). However, despite increasing technology in the printing industry added to widely
available management tools, print productivity still has fallen further behind other
manufacturing industries (Grant, 2003; Uribe, 2008; Zeng, Lin, Hoarau, & Dispoto, 2009). In
response to this, a system dynamics approach, modeling print production system, is provided
to better understand the inter relationships between operation parameters and to uncover
feedback loops influencing overall organization productivity.

Competition identified, by both researchers and managers, which always been described as
tough in many industries (e.g. Scherer, 1970; Schumpeter, 1939/1964; 1942/1975). Nevertheless,
competition in general has become more aggressive and fast paced and in many industries
today it has become increasingly hard to sustain competitive advantages for long due to
powerful and quick competitive moves (Bourgeois & Eisenhardt, 1988; Brown & Eisenhardt,
1998; D’Aveni, 1994; Dierickx & Cool, 1989; Thomas, 1996; Wiggins & Ruefli, 2005).
Accordingly, Fombrun (1993, p. 186) states that the competitive landscape is getting more
clustered “where firms once competed in isolation, are now competing as allies in business
communities” and an increase in the formation of partnerships in the last decades can be
noted (e.g. Hagedoorn, 1995; 2002; Hergert & Morris, 1988; Mariti & Smiley, 1983). Even
through tough competition an industry, in general, favors the formation of alliances
(Eisenhardt & Schoonhoven, 1996; Shan, 1990), competition between partners is a difficult
situation to handle. This is especially true in a fragmented industry where many potential
cooperating partners become competitors.

CHALLENGES FOR THE PRINTING INDUSTRY IN SRI LANKA

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Proactive maintenance of an existing customer base to improve our `bottom-line`. This is the
future strategy for all to be successful in a global trading environment. Marketing to existing
customers and prospects, with the goal of retaining their business while stimulating the
marketers` sales. Also, the importance of the retention of employees lies in this task. Building
and Communicating Value is the single most valuable investment on organization which makes
on the road to delivering sustainable shareholder value.

The creation of shareholder value is the primary objective of any organisation, be it a plc or
privately funded company -and research indicates that due to work pressure senior managers
already face to deliver value which will intensify significantly into the future with a global
economy.

Today, it is vital that all senior management builds and delivers superior long-term value to
meet and exceed the expectations of all its organizations shareholders. The current state of the
Printing and Graphics Arts industry has been variously described as stagnant, revolutionary
and on the brink, set against the vendor hype associated with all things Digital. The change will
be rapid! In many cases, Commercial Printers are finding the pace of change in technology far
too rapid and cannot cope with the uncertain business conditions facing the industry. Also,
many Commercial Printers have no succession planning and are `life style` companies and the
true worth of the company is not at the same value as the owner. Despite all the doom and
gloom and despondency that Printers are complaining about, the market is challenging
opportunity. We are in `business`, so act and perform as business people do! Printing is a by
product/service of the business, so business methods are the most important -what is required
are skilled and experience people in all areas of `the business`. Plus, business models to help the
business perform to global standards.
Between 2000 and 2007, the industry went through rapid growth from conventional ink-on-
paper to include graphic design, data handling, web services, subscription management,
enveloping and wrapping, mailing, distribution, warehousing and fulfilment. But, what will the
next ten years bring? Sri Lanka and emerging Asian countries have just bypassed traditional
print and gone straight to Digital printing. Sri Lanka has gone absolutely mad on wide-format.

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Digital is growing, but would not take over from conventional methods in the short to medium
term.

The biggest challenge facing the printing industry has become what almost seems like a "war on
print" by those who produce and disseminate content. The advertising and marketing industry
enthuses about online and even newer media 24/7-and has even taken to referring to print as
"offline media." What the industry needs is not only to fight back and remind people of the
effectiveness of print, but also to come to the same conclusion as its most successful customers:
`that print walks hand-in-hand with other media`.

CHALLENGES AND OPPORTUNITIES FOR THE PRINTING INDUSTRY IN THE

NEXT 12 MONTHS AND BEYOND

It's no secret that many firms in the industry have been struggling, and demographic data show
a great deal of confusion that continues relatively unabated. Yet, there remain very successful
businesses in the industry. Cultural changes in the way people access media are having
profound effects on the demand for print, particularly among advertisers, marketers, and
publishers-all of whom are, not coincidentally, printers' biggest customers. How has the
explosion of new media affected the print markets? What can the industry do to effectively cope
with these trends? And what will 2011 bring?

In 2010, digital printing; personalized, customized, variable-data, and other targeted printing
applications; "Web-to-print"; wide-format printing; and interest in and implementation of
production workflow solutions are progressing rapidly. But, do not forget business models,
which will increase the `bottom-line`! Plus, experienced and skilled people of `any` age are a
major asset. 2010 has seen marketers and advertisers steadily distancing themselves from print,
and yet, given the effectiveness of print, they do so at their peril. Regardless, "cursing the
darkness" won't help; printers need to develop a cogent strategy for responding to this trend.
What the industry needs is an emphasis on seeking out new business models, niches, and
applications for print. This is 180 degrees from how the industry tends to operate; but the need
to do so has never been greater and will only become more profound in the year(s) ahead.
Research and plan ahead, and not put their head in the sand.

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In contrast to other manufacturing industries, printing organisations are geographically spread
right across the country. There is little or no training for succession planning in the people
arena, therefore the rapid change is to Digital printing with keyboard skills against craft skills.
The traditional printing industry is killing itself by no training/use of business models and lack
of experienced and skilled people and therefore can only cast blame on the lack of management
strategy to see the future. The needs are continuous training programmes for all employees
with effective business models plus the passion to be successful is a necessity.

NOW AND THE POTENTIAL FUTURE OF JDC GROUP

JDC’s philosophy is to develop the highest quality presses. Press that allow printers to produce
value added products and meet strict environmental standards. As a result, sales of all JDC
have been strong.

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In recent years, JDC have seen significant improvements in digital printing quality as well as
the ability of sheet fed offset presses to accommodate short turnaround, small –lot requests.
Accurately reflecting the requirements and views of customers in JDC’s development, sales and
services activities has served as the springboard for JDC’s next leap forward. From a long –term
perspective, Mr. Cyril’s vision is that JDC will be recognized as leader of supplying printing
machineries & materials
.

A STRATEGY FOR THE FUTURE

“LEAN AGAINST THE WIND STRATEGIC PLAN METHODOLOGY- OPEN YOUR

MIND TO THE 'CHALLENGES’ WE FACE IN A GLOBAL TRADING ENVIRONMENT TO

BE SUCCESSFUL”

 lower cost, less waste and shorter changeovers

the JDC Group’s choice of this took shape after carefully assessing three main aspects: first,
higher print quality that fully conforms to client – specified parameters; second, lower
production costs thanks to extremely short changeovers and the advantages of invoking all
operations directly from the operation console; and, third, more environmental friendliness due
to dramatically reduced production waste and short changeovers times.

 Innovative corporate culture produces superior products

“FORGING NEW OPPORTUNITIES BY HARNESSING THE POSITIVE WINDS OF THE ERA AND
CONTINUALLY BUILDING ON TECHNOLOGICAL INNOVATION” – J D CYRIL , MANAGING DIRECTOR

Sri Lanka’s stated aim of realizing an environmentally sustainable society, business related to
paper holds enormous possibilities. It is important to have an aggressive stance today precisely
because of the severe difficulties we are facing during global economic down turn.

 Completely customer driven

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JDC believes the strength of the organization also plays a part in its business growth:”customers
are focused on quality”. Employees, machineries, business process all are geared to one
common goal of ensuring the customers are completely satisfied.

 Improve Environmental performance with Lean Techniques

Print and packaging businesses are beset by commercial, financial and environmental pressures.
JDC management will demonstrate best practice in three related thesis: ‘smart’ use of
technology, material waste reduction and environmental management. Applying all three
using “lean” process will raise JDC’s competitiveness and productivity – providing that staff
engagement can be maintained.

FUTURE DIRECTIONS OF JDC GROUP

Digital printing systems vendors will continue to push speed and increase resolutions of their
machines as well as introduce new color systems.

Paper documents will become more `intelligent` through the creation of efficient coding
systems.

The ability to view, archive, search. retrieve, distribute electronically in any format, and print
any document, at any time, and from any platform will be key in the future. Organization will
be successful, if they have the `right` people with the passion, experience/skills together with
the business models to forge the way ahead in the world of change. Take on board business
guides and business models to achieve an increase in sales, gross and net margins and the
retention of people. Training is the most important tool to success!
“New ideas flourish faster when their enabling technologies are versatile, cost effective,
efficient and well supported”
CONCLUSION

While continuing to confront an extremely difficult operating environment, JDC’s financial

standing remains firm, particularly when compared with industry peers. Recognizing crisis
conditions as an opportunity to reform JDC structure and system, JDC will work closely to

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implement the strategic plan in an effort to further enhance their competitive advantage and
cement their position as a leading company.

“VISION, COMMITMENT AND INVESTMENT MAKE THE

DIFFERENCE”

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